Aussie kids are earning more pocket money than their parents did, spending big on gadgets and struggling with the concept of digital money, the latest research from Commonwealth Bank reveals.

According to the 2017 School Banking Study, Aussie kids receive on average almost $6 per week, and start receiving pocket money from the age of six. At the same age, their parents, who were children in the ‘80s, received just $1.67, which would be $3.61 today according to the Reserve Bank.

Expectations around chores also differs as three in four parents (76 per cent) were expected to complete chores to receive pocket money compared to 83 per cent of children today who are expected to complete chores as showed in a CommBank Common Cents report from 2015.

There are also some big changes in what children are saving for. Almost half (42 per cent) are putting money away for electronic devices such as smartphones, tablets and virtual reality headsets, whilst the top items for their parents were books – such as Roald Dahl’s The Twits and The BFG –  and clothes such as scrunchies and neon tracksuits.

How kids are saving and spending 

Aussie kids are also showing they’ve got great savings skills, saving the majority of their pocket money for big ticket items (56 per cent of funds), rather than spending it (44 per cent of funds). In addition, half of Aussie parents (53 per cent) let their kids make spending mistakes to teach them lessons about the value of money, but at the same time, just under half (49 per cent) are also helping their kids develop budgets or set savings goals.

Children are also receiving pocket money earlier than ever: In 2016, the average age at which kids received pocket money was six years old. This is four years younger, on average, compared to their parents’ generation¹. Interestingly, more than half of parents surveyed were involved in the Commonwealth Banking School Banking program when they were at school.

Cashless Society: Tips for teaching kids about digital money 

More than half of parents (60 per cent) believe their kids’ understanding of the value of money is less than their own when they were younger. Unsurprisingly, they attribute some of this to the difficulties in teaching and understanding digital money. 

Approximately one in five parents have taken to various methods to hone their children’s skills and literacy around digital money management and cashless transactions. The research found parents are alternating between cash and online bank transfers when giving their children pocket money, actively demonstrating ‘tap and go’, online banking, mobile applications and how ATMs work.

“The majority of parents agree digital transactions make it more difficult for kids to understand the value of money. And we understand that challenge. That’s why in a society where cash is less common, the Commonwealth Bank School Banking program is increasingly more important in teaching children lifelong money skills and fostering good savings habits,” said Veronica Howarth, Head of School Banking and Youth, CommBank.

Additionally, almost three in four (72 per cent) Australian parents teach kids they can earn more money by doing extra tasks outside of their usual chores, helping children learn about the value of money, develop good saving habits and achieve goals.

A third (33 per cent) of parents choose to not give their kids pocket money, most commonly preferring to give money as they need it, or putting money away for them until they’re older.

Pocket money across the generations and the country² 

The increase of pocket money (weekly average)³

To find out more about how Commonwealth Bank supports teaching children about money, visit: www.commbank.com.au/schoolbanking 

ENDS

About the School Banking Study

The Commonwealth Bank School Banking Study was an online survey of 1,046 parents across Australia undertaken by ACA Research in December 2016.About the School Banking Study.

¹Note to editors: Sourced from 2014 Commonwealth Bank research data.

²Figures not adjusted for inflation 

³Figures not adjusted for inflation